What do Ireland's problems mean for the rest of the world?
Ireland's troubles have made big news all week, and today officials from Europe and the International Monetary Fund are in Dublin for . Many are framing Ireland's financial woes as a matter of life and death. As Ireland's sputtering economy took centre stage, Herman von Rompuy warned that the European Union was in a over eurozone debt problems. With all this talk of zombie banks and contagion, Ireland's sovereign debt crisis is sounding more and more like a horror film. But why is there so much panic about a small island's money problems?
It's looking like Ireland's going to get a bail out from either the IMF or the EU. But Ireland's been dragging its feet on the issue. Why is it such a nightmare for Ireland to accept a bail out? Whether Ireland accepts IMF or EU money, it's going to have to agree to run some of it's budget on their terms. Rory Fitzgerald says it's a matter of :
the EU may be part of the problem and not part of the solution. Not least because the Irish people are tiring of EU over-regulation and its threats to take away more of our sovereignty as well as the 12.5% corporate tax rate which has attracted so much American investment to Ireland.
This blogger says Ireland should and deal with its own mistakes
By entangling itself with the IMF or EU, Ireland's economic and monetary policies would be guided by outside forces that have a record of giving bad advice. In refusing a bailout and embracing responsibility, Ireland will set a healthy example that other nations should follow.
But Irish economist David Mcwilliams says accepting the bitter medicine of EU money is the only practical solution. His take is if Ireland doesn't accept money from the European Central Bank, the to the rest of Europe:
If the ECB doesn't sort this out, it risks the possibility that contagion will sweep away its euro experiment.That is our only option now and massive financial aid from the ECB is the only way deposits will be safe. It will not be pretty or pleasant, but it's what has to be done now.
So should Ireland be bailed out? How will this affect Europe and the rest of the world? Has the Euro failed?
